The developer of 211 East 51st Street has kicked off a new luncheon series, in hopes that brokers will eat it up.
Henry Justin of HJ Development, the developer of the 73-unit condo conversion, is hosting complimentary, personalized luncheons for small groups of buyers’ brokers in an effort to drive sales at the 14-story building. The project is 35 percent sold after going on sale in May, said Kimberly Mancini, director of sales at the building.
In the current economy, Mancini said, it’s more important than ever to attract the attention of buyers’ brokers. “I recognize how critical a broker is to helping a sale,” she said. “We wanted to reach as many as we could, and increase our odds. Hopefully they’ll fall in love with the building.” And that could in turn lead to more sales.
For the past several weeks, Mancini has been reaching out to brokerage teams in the area, offering them a catered luncheon at a model home at the former rental building, located between Second and Third avenues, where construction is now finished. The menus for the luncheons, thus far held for brokers from Century 21 New York Metro as well as other companies, have included wine and cheese, panninis and wraps, and happy hour, depending on the company’s preference.
The developer is hoping the events will be more effective in luring brokers than regular open houses, which usually don’t require an RSVP or appointment, Mancini said. By contrast, these personalized luncheons involve “a little more accountability on [the buyer's broker's] end,” she said.
The technique seems to be successful at attracting brokers. At a luncheon for Coldwell Banker affiliate Previews International a few weeks ago, a snowstorm didn’t stop the brokers who’d RSVP’d, from coming. “It was miserable weather and they all still attended,” she said.
Mancini said the initiative has led to several leads on potential buyers.
The luncheons are catered for 20 to 25 people and provide an opportunity for questions with Justin, a former songwriter, which larger open houses usually do not, she said.
Prices in the building have fluctuated since they went on the market, according to Streeteasy.com, with some units increasing and others decreasing.
“We’re negotiating, but not firesale-ing, the building,” Mancini said.
The project doesn’t have much room for price reductions. In June, Justin provided The Real Deal with a detailed projected budget for 211 East 51st Street.
The cost to renovate the 76,500-square-foot building was estimated at roughly $76 million, including $46 million to buy the vacant rental building, and the total cost for an average 856-square-foot one-bedroom apartment was $1,041,096. With an average home asking price of $1.1 million, that left the developer with a profit of $58,904 or 5.7 percent, a relatively low rate of return.
At the time, Justin said he expected to earn his usual 10 to 15 percent profit on the whole project by factoring in the commercial units. One commercial unit is under contract for $2.7 million, but the other two are still available, Mancini said.